Toronto stocks set for soft open amid profit-taking

Wed Jun 18, 2008 9:08am EDT
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*TSX set for weaker opening after three strong sessions

*Investors await oil inventory data

TORONTO, June 18 (Reuters) - The Toronto Stock Exchange's main index looked set to take a breather on Wednesday, following three days of strong gains which could prompt investors to book profits.

Volatility in the price of oil could add choppiness to the benchmark index as investors awaited inventory data due later in the day that was expected to show a decrease in U.S. crude stocks. The price of oil was firm above $134 a barrel.

"On the Canadian side, we had a good run for three days now in a row, so I would not be surprised to see the market taking a breather," said Joe Ismail, technical analyst at Maison Placements Canada.

While higher oil prices typically boost the TSX's heavyweight energy sector, worries of inflation stoked by rising energy prices have crept in and have added volatility to the market.

Ismail noted that agriculture stocks such as Potash Corp of Saskatchewan POT.TO and Agrium AGU.TO could see some profit-taking following gains in recent days amid flooding in the U.S. Midwest growing region.

Investors were also awaiting a decision on the outcome of the buyout of BCE Inc BCE.TO after Canada's Supreme Court delayed a ruling on Tuesday whether to approve or reject the deal. The court did not say when it will render its decision.

Shares of ATS Automation Tooling Systems ATA.TO could see interest after the company swung to a fourth-quarter profit amid restructuring as part of its plan to return to profitability.   Continued...